Implementing health reform

Easy-to-understand health plan summaries would be extremely popular with consumers, according to recent polls. That shouldn’t be surprising. Consumers dread choosing health insurance, as various surveys show, largely because they don’t understand it.

But the new health care law now calls for uniform health insurance summaries, available to all consumers starting in 2012. The Affordable Care Act requires that this summary be “understandable to the average plan enrollee.”

Story Continued Below

Every private health plan is required to provide this summary, so consumers for the first time will be able to compare options on an apples-to-apples basis. This holds true even if the options are from two different employers, or consumers are considering options on an individual basis.

We expect a final ruling from the Office of Management and Budget soon. But the real question is: What will the rule, and ultimately the summaries, look like?

Though the law is clear, strong objections from certain employer groups cast doubt on what consumers will likely get to see. Certain employers say that the health plan information they already provide should be sufficient. Yet when the new form was tested with workers who already have employer-based coverage, they strongly preferred the revised format — finding it clearer and easier to use.

The Affordable Care Act also strengthened the new summaries by requiring a feature called “Coverage Examples.” These would show what the plan covers under certain standard medical scenarios, like having a baby. But this new feature, which consumers liked because it “did the math for them,” also is threatened.

Health insurers have objected to the coverage examples, citing possible consumer confusion and the effort of compiling the cost data. Again, these concerns have been called into question since consumer testing showed this new feature to be tremendously helpful and less confusing than traditional displays of health insurance information. Showing the deductible, coinsurance and other elements is necessary. But it doesn’t provide a “bottom line” on how much coverage the plan offers.

Consumers should not have to select a plan without access to this basic, bottom-line information — and insurers are better positioned than consumers to calculate the plan payments for standard medical scenarios.

A key opportunity would be missed if the coming rule does not incorporate a robust vision for the new form — including a requirement that employers provide the form and strong “coverage examples.” The evidence is clear — today’s health plan documents are insufficient.

In light of the financial and health implications, it is past time to provide consumers with understandable, standardized health insurance documents.

Health insurance markets cannot work efficiently unless Americans have the basic, comparable information crucial in making the best choices for their families and businesses. Surely these are goals everyone can agree to.